Atlanta-based The Home Depot last week announced it will formally create a business development operation based in China and named Bill Patterson to the newly created position of president, The Home Depot Asia. Patterson will lead the company's expansion into China, and will report directly to Bob Nardelli, chairman, president and CEO of The Home Depot.
Patterson, who has served as president, Central Division since 2002, joined The Home Depot in 1999. Prior to The Home Depot, Patterson's experience spanned more than 30 years in retail in the United States, Asia, Mexico and Europe. Patterson held positions as chairman, president and CEO of Sears Roebuck of Mexico, and president and CEO of HomeBase, then the sixth largest home improvement retailer in the U.S. "I am confident that Bill's international experience, operational skills and leadership abilities will drive a successful entry into the China market for The Home Depot," said Bob Nardelli.
China's GDP is nearly $1.5 trillion. The country's population is growing, along with personal wealth. It is estimated that the Chinese home improvement market today is at nearly $50 billion and growing at a compounded rate of 20 percent.
"About 70 percent of home improvement spending in China is for completion of interior space in new homes. We see that as a solid growth opportunity given The Home Depot's strength in merchandise and services geared to finishing out a home," said Patterson.
The market potential for The Home Depot in China is helped not only by the growing economy there, but by the relatively limited competitive landscape. According to the company, there are few large-format home improvement stores in China today, and the country is largely served by small outdoor markets and shopping malls.
The announcement is the company's latest move as it expands its market presence internationally. The Home Depot just completed its acquisition of Home Mart in Mexico, which doubled the company's presence in that country and establishes it as the leader in Mexico's $15 billion home improvement market. In addition, the company will celebrate its 10th anniversary in Canada this year, where it operates more than 100 stores.
"Based on our success in expanding to international markets, I am confident of the portability of our model to China," added Nardelli.
Concurrent with this move, the company also announced that Troy Rice, senior vice president, operations since 2002, will replace Patterson as president, Central Division at its Chicago office. Rice, a 14-year veteran of The Home Depot, had previously served as a division president for its former Northwest Division from 2001 to 2002. The Central Division services about 600 stores, including the company's 40 stores in Mexico, and employs approximately 80,000 associates.
The company also announced it has promoted Carl Liebert to senior vice president, operations, replacing Rice. Liebert joined The Home Depot last year from Circuit City, where he served as a division president. Both appointments are effective immediately.
Home Depot has 1,766 stores in 50 states, the District of Columbia, Puerto Rico, eight Canadian provinces and Mexico. Home Depot Rentals is No. 7 on the RER 100 with rental departments in about 800 stores in North America.